Analysis Of The Motivation And Performance Of Stock Repurchase

Stock repurchase refers to the repurchase of tradable shares of the company through the company's own funds or outward borrowing,which is a means of capital operation.The stock repurchase,a capital operation method,has a long history of development in western developed countries,and the theory of repurchase formation is relatively perfect.The stock repurchase has been used in China late,and in the early stage,there are more constraints on repurchase,which has hindered the development of China's stock repurchase.With the development of China's economy,the motive of initial repurchase is to serve the split of equity.The repurchase of state-owned shares reduces the proportion of state-owned shares in enterprises and improves corporate governance.With China's economic development,the relevant laws and regulations have been improved,the restrictions on China's stock repurchase have gradually decreased,and the motives for implementing stock repurchases have become more diversified,especially in recent years,a large number of companies have joined the ranks of stock repurchases..This paper mainly studies the motives of repurchase and the analysis of performance.The case study of Mengwang Group ended the first round of stock repurchase from July 2017 to November 2017,from December 2017 to July 2018.Completed the second stock repurchase,and in August 2018 launched a new round of stock repurchase.The company's motivation to take stock repurchase behavior so frequently and its impact on the company's performance deserves further exploration.The author first briefly introduces the research background and research significance related to stock repurchase,and then summarizes the literature after reading the related literature at home and abroad.Drawing on the established theories,sum up and analyze the motivations of stock repurchases and the financial effects.Secondly,“A Brief Analysis of Mengwang Group's Stock Repurchase Case” is divided into three parts: The first part introduces the overview of Mengwang Group,including the reasons for choosing the case,as well as the company's financial and shareholding structure.The second part is mainly A detailed interpretation of the entire stock acquisition process,the next part of the analysis of this continuous stock repurchase motives,mainly including the stability of the company's stock price,the implementation of equity incentives and optimization of capital structure.Thirdly,according to the relevant theory,the Mengwang Group stock repurchase performance research,this section first explored the extent of the impact of stock repurchase on the group's stock price.Then,by tidying up the share ratio of the top ten shareholders of Mengwang Group before and after the repurchase,analyze the impact of stock repurchase on the shareholding structure.Since Mengwang Group completed the first repurchase,it was only one month later.The implementation of the second round of repurchase,the gap is short,so this article according to the announcement,regular report,select the relevant financial indicators for different quarters of 2017-2018 more time-sensitive,can more timely response to the company due to stock repurchase The change that comes.According to the changes of the company's asset-liability ratio in different quarters,the impact of stock repurchase on the company's capital structure is analyzed.Next,the author analyzes the impact of stock repurchase on its performance based on the differences in financial indicators between quarterly solvency and operational capabilities.Finally,the impact of stock repurchase on the company's cash flow is analyzed.Based on the above analysis,this paper concludes that Mengwang Group's stock repurchase does not maintain long-term growth in stock prices,increases financial risks and pays for negative financial impacts.At the same time,stock repurchases also bring about optimizing capital structure and improving operational capabilities.Positive influences,and put forward relevant suggestions,have certain reference value for other companies that plan to adopt stock repurchase as a capital operation means in the future.